How Is TTK Healthcare's (NSE:TTKHLTCARE) CEO Paid Relative To Peers?

T. Raghunathan became the CEO of TTK Healthcare Limited (NSE:TTKHLTCARE) in 2014, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether TTK Healthcare pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for TTK Healthcare

Comparing TTK Healthcare Limited's CEO Compensation With the industry

At the time of writing, our data shows that TTK Healthcare Limited has a market capitalization of ₹6.8b, and reported total annual CEO compensation of ₹11m for the year to March 2020. That's a notable decrease of 48% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at ₹3.6m.

On comparing similar-sized companies in the industry with market capitalizations below ₹15b, we found that the median total CEO compensation was ₹3.0m. Hence, we can conclude that T. Raghunathan is remunerated higher than the industry median. Furthermore, T. Raghunathan directly owns ₹19m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represented approximately 99% of total compensation out of all the companies we analyzed, while other remuneration made up 1.3% of the pie. It's interesting to note that TTK Healthcare allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

TTK Healthcare Limited's Growth

Over the last three years, TTK Healthcare Limited has shrunk its earnings per share by 28% per year. In the last year, its revenue is down 7.9%.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has TTK Healthcare Limited Been A Good Investment?

Given the total shareholder loss of 36% over three years, many shareholders in TTK Healthcare Limited are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As we noted earlier, TTK Healthcare pays its CEO higher than the norm for similar-sized companies belonging to the same industry. Unfortunately, this doesn't look great when you see shareholder returns have been negative over the last three years. What's equally worrying is that the company isn't growing by our analysis. Understandably, the company's shareholders might have some questions about the CEO's remuneration, given the disappointing performance.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 4 warning signs for TTK Healthcare (1 shouldn't be ignored!) that you should be aware of before investing here.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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